Toni De Lanoy, ALJ Ruling 2024-1 (HHS CRD October 3, 2023)

DISMISSAL

The Inspector General (IG) of the United States Department of Health and Human Services excluded Petitioner, Toni De Lanoy, from participating in federal health care programs for 26 years.  Petitioner requested a hearing before an administrative law judge (ALJ) to dispute the exclusion.  Subsequently, the IG moved for dismissal of the hearing request as untimely.  After considering Petitioner’s response, I conclude that Petitioner’s hearing request is untimely.  Because the regulations governing this case require me to dismiss an untimely hearing request, I grant the IG’s motion and dismiss this case. 

I.  Procedural History and Background

In a February 28, 2023 notice, the Office of the IG (OIG) stated that Petitioner was being excluded from participation in all federal health care programs under section 1128(a)(1) of the Social Security Act (42 U.S.C. § 1320a-7(a)(1)) for a period of 26 years.  IG Ex. 1 at 1.  OIG alleged that Petitioner had been convicted of a criminal offense in the United States District Court for the District of Georgia related to the delivery of an item or service under Medicare or a state health care program.  IG Ex. 1 at 1.  OIG alleged the following aggravating factors as support for the 26-year length of exclusion: 

Page 2

1. The acts resulting in the conviction, or similar acts, caused, or were intended to cause, a financial loss to a government agency or program or to one or more other entities of $50,000 or more. . . .  The court ordered [Petitioner] to pay approximately $6,450,400 in restitution. 
2. The acts that resulted in the conviction, or similar acts, were committed over a period of one year or more.  The acts occurred from about June 2016 to about July 2020. 
3. The sentence imposed by the court included incarceration.  The court sentenced [Petitioner] to 30 months of incarceration. 

IG Ex. 1 at 1. 

The February 28 exclusion notice stated that important information about Petitioner’s right to appeal the exclusion was enclosed with the notice and that Petitioner should read these documents carefully.  IG Ex. 1 at 2.  Included with the notice was a document entitled “How to Appeal Your Exclusion,” which stated, in part: 

A request for hearing must be made in writing within 60 days of receiving the OIG’s notice of exclusion.  The date of receipt of the notice will be presumed to be five (5) days after the date of such notice unless there is a reasonable showing to the contrary.  See 42 C.F.R. § 1005.2(c). 

IG Ex. 1 at 4. 

On May 12, 2023, Petitioner, through counsel, electronically filed with the Civil Remedies Division a Request for Hearing before an Administrative Law Judge (RFH).  In the RFH, Petitioner challenged the length of the exclusion and sought a reduction to five years.  RFH at 1.  The RFH also stated that: 

[Petitioner] did not receive [the exclusion notice] until March 14, 2023 and [Petitioner’s counsel] submitted a letter to the OIG indicating that date of receipt and the deadline by which this appeal would be filed.  [Petitioner’s counsel] has not yet received a response to that letter. 

RFH at 1 n.1        

Page 3

On May 15, 2023, the Civil Remedies Division acknowledged receipt of the RFH, issued my Standing Order, and informed the parties I would hold a prehearing conference on June 1, 2023. 

I held a telephonic prehearing conference on June 1, 2023, at which counsel for the parties appeared.  At the conference, I established a prehearing hearing submission schedule and confirmed that Petitioner was only challenging the length of exclusion.  The IG did not move for dismissal of the RFH.  See June 1, 2023 Order Following Prehearing Conference and Setting Schedule for Prehearing Submissions. 

On August 31, 2023, the IG timely filed a prehearing exchange consisting of a brief (IG Br.) and seven exhibits (IG Exs. 1-7).  The IG’s first argument included the following:  “Petitioner’s request for hearing was untimely, therefore, the ALJ does not have authority over this matter and the I.G. requests the case be dismissed.”  IG Br. at 2.  Because the IG contested my jurisdiction to adjudicate this case, I ordered Petitioner to respond to the IG’s motion by September 21, 2023.  See Sept. 7, 2023 Order.  Petitioner timely filed a response (P. Resp.) along with six exhibits (P. Exs. 1-6). 

II.  Discussion

Any individual or entity convicted of certain criminal offenses must be excluded from participation in all Federal health care programs for a minimum of five years.  42 U.S.C. § 1320a-7(a), (c)(3)(B).  If the IG determines that a conviction constitutes a proper basis for exclusion, the IG must send notice of the exclusion to the affected individual or entity.  42 U.S.C. § 1320a-7(c); 42 C.F.R. § 1001.2002(a).  The IG must give the excluded individual or entity reasonable notice of the opportunity for a hearing to contest the exclusion.  42 U.S.C. §§ 405(b)(1), 1320a-7(f)(1); 42 C.F.R. § 1001.2002(c)(6). 

A RFH to dispute an exclusion “must be filed within sixty days after notice of such decision is received by the individual making such request.”  42 U.S.C. §§ 405(b)(1), 1320a-7(f)(1); see 42 C.F.R. §§ 1001.2007(b), 1005.2(c).  Further, “the date of receipt of the notice letter [is] presumed to be 5 days after the date of such notice unless there is a reasonable showing to the contrary.”  42 C.F.R. § 1005.2(c). 

The regulations do not allow an ALJ to extend the 60-day filing deadline for good cause (see 57 Fed. Reg. 3298, 3323 (Jan. 29, 1992)), but only allow an excluded individual to make a reasonable showing to rebut the presumption that the exclusion notice was received more than five days after the date of the notice.  See Kenneth Schrager, DAB No. 2366 at 4 (2011).  In response to public comments on this subject, the Secretary of

Page 4

Health and Human Services (Secretary) expressly declined to permit a good cause exception to the timeliness requirement for hearing requests.¹  57 Fed. Reg. at 3323. 

The IG moves for dismissal because Petitioner filed the RFH more than 65 days after the date on the February 28, 2023 exclusion notice.  Specifically, the IG asserts that the law and regulations required Petitioner to file the RFH 60 days following receipt of the exclusion notice and that the regulations presume that receipt occurred within five days of the date of the notice.  IG Br. at 1.  The IG further asserts that it is OIG’s practice to mail exclusion notices on the date appearing on the exclusion notice.  IG Br. at 1-2.  In addition, the IG stated that OIG neither received the February 28, 2023 exclusion notice back from the postal service nor a letter or email from Petitioner’s counsel about receipt of the February 28, 2023 exclusion notice.  IG Br. at 2.  Based on these assertions, the IG argues the following: 

To timely request a hearing regarding her exclusion, Petitioner was required to file a written request no later than May 4, 2023, 65 days after the date of the notice of exclusion.  42 C.F.R. § 1005.2(c).  Petitioner did not comply with the applicable procedure and filed her request for hearing on May 12, 202[3], 8 days after the appeal deadline, and without evidence that the notice was not timely received. 

IG Br. at 2.  

In support of the motion, the IG submitted declarations from two OIG officials.  One of the officials, a senior counsel, “processed the exclusion” in this case.  IG Ex. 6 ¶ 1.  The senior counsel stated:  “It is the policy and practice of the OIG to send out notice of exclusion letters on the day that they were dated.  Thus, the date on the notice of exclusion letter reflects the date that it is placed in the mail.”  IG Ex. 6 ¶ 3.  The senior counsel also reviewed the case file for this case and confirmed that the exclusion notice was not returned to OIG and “[t]here is no correspondence from Petitioner or her counsel about the notice of exclusion letter after it was mailed on February 28, 2023.”  IG Ex. 5 ¶ 5(d), (e).  Another OIG official stated:  “I have personally reviewed the exclusions@oig.hhs.gov email inbox and . . . have determined that no email correspondence was received from Petitioner or from the office of her Counsel about Petitioner’s notice of exclusion letter after it was mailed on February 28, 2023.”  IG Ex. 7 ¶ 4. 

Page 5

In response, Petitioner does not dispute the February 28, 2023 mailing of the exclusion notice.  P. Resp. at 1.  Petitioner also does not dispute receiving the exclusion notice.  P. Resp. at 2.  Petitioner simply contends that Petitioner received the exclusion notice on March 14, 2023, the day on which she reviewed mail that had accumulated while she had been away on a work trip.  P. Resp. at 2.  Petitioner argues that: 

Petitioner was in receipt of the Notice of Exclusion letter on March 14, 2023.  The regulatory 60 days afforded to the Petitioner began running on that day, which would mean Petitioner had until May 13, 2023, but given that May 13th was a Saturday, Petitioner had until May 15, 2023, to submit a timely request for hearing.  Petitioner timely submitted her request for a hearing on May 12, 2023. 

P. Resp. at 2. 

In support of Petitioner’s position, Petitioner provided a declaration as to the events related to receipt of the exclusion notice.  Petitioner works as a contract project manager for a roofing company.  P. Ex. 1 ¶ 2.  On February 27, 2023, Petitioner travelled to Port Charlotte, Florida, to perform project manager duties on roofing projects connected to hurricane damaged structures.  P. Ex. 1 ¶ 3; see also P. Ex. 2 (Petitioner’s emails with probation officer indicating a work trip from February 27, 2023 through March 12, 2023); P. Ex. 3 (screen shots of Petitioner’s calendar).  After an approximately eight-hour drive, Petitioner arrived home near mid-night on March 12, 2023.  P. Ex. 1 ¶ 4.  Due to a car accident (not involving Petitioner personally) on March 8, 2023, that totaled a car purchased for Petitioner’s son, Petitioner spent March 13, 2023, working on an insurance claim.  P. Ex. 1 ¶ 5; see also P. Ex. 4.  It was not until March 14, 2023, that Petitioner reviewed mail received during the work trip.  P. Ex. 1 ¶ 7.  Petitioner forwarded a scanned copy to counsel on March 14, 2023.  P. Ex. 1 ¶ 7; P. Ex. 5. 

The primary legal issue that I must resolve is the question as to when an excluded individual receives an exclusion notice.  The IG asserts it is when the exclusion letter is delivered by the postal service to an excluded individual’s address.  Petitioner argues that an excluded individual only receives an exclusion notice when the excluded individual reads the exclusion notice, regardless as to when the exclusion notice was delivered to the excluded individual’s address. 

As stated above, receipt of an exclusion notice is presumed to be within five days of the mailing of the notice.  42 C.F.R. § 1005.2(c).  This presumption, which can be rebutted, favors an interpretation that an excluded individual receives the exclusion notice when it is delivered by the postal service.  When promulgating section 1005.2(c), a public comment recommended that the OIG be required to send exclusion notices by certified mail and that receipt of the exclusion notice would be the date on the return receipt

Page 6

obtained from the postal service.  57 Fed. Reg. at 3319.  The Secretary rejected this suggestion in favor of the five-day presumption of receipt.  57 Fed. Reg. at 3320. 

There do not appear to be administrative appellate decisions that speak to the exact situation in this case.  However, there are ALJ decisions that involve scenarios similar to the present case.  Those decisions indicate that receipt of the exclusion notice is the date the notice was delivered to the address on the notice.  In one case, an ALJ dismissed a RFH as untimely because the exclusion notice was delivered even though the excluded individual was not given the notice immediately: 

Petitioner does not deny that the I.G.’s notice letter was delivered to her address.  Instead, she explains that her husband has dementia and hides the mail.  Under a different regulatory scheme, I might find that Petitioner’s explanation establishes good cause for her late filing.  However, as explained above, 42 C.F.R. § 1005.2(e)(1) does not permit me to accept a late filing, even upon a showing of good cause. 

Linda Marie Bonner, DAB CR4796 at 2 (2017) (citations omitted).  Therefore, in Bonner, the ALJ considered the exclusion notice delivered once it reached the excluded individual’s address and that a delay in the excluded individual reading the notice did not extend the date of receipt.  Rather, the delay in seeing the exclusion notice would only be an excuse for late filing, an excuse that the ALJ could not consider. 

In a second case, the excluded individual argued that, despite the presumed date of receipt (September 5, 2006), the week contained a holiday and the excluded individual “did not resume normal and regular routine until . . . September 11, 2006.  As a result, [the excluded individual] did not have actual notice of the I.G.’s notice until September 11, 2006.”  Alan K. Mitchell, M.D., DAB CR1614 at 6 (2007).  The ALJ rejected the excluded individual’s argument because the excluded individual was too vague in explaining the delay in reading the exclusion notice.  Mitchell, DAB CR1614 at 8.  However, the ALJ also noted: 

But would Petitioner’s position now be stronger if he could prove that his medical office was closed during those four days, and that the mail simply piled up until Monday, September 11, 2006? . . .  [T]hat answer is “No.”  Petitioner’s management of his office and any consequences that arise from it, including delays in his personally reviewing mail delivered to him at that address, are simply not sufficient as a “reasonable showing to the contrary.”

Page 7

Mitchell, DAB CR1614 at 8; see also Sunil R. Lahiri, M.D., DAB CR296 at 24 (1993) (“It flows from my conclusion (that the I.G. is under no obligation to personally serve Petitioner with the Notice) that the Notice is deemed received the moment it is delivered to Petitioner’s place of business unless there is a reasonable showing to the contrary.”). 

I find these ALJ decisions to be persuasive and I follow them.  

In the present case, Petitioner does not assert that the exclusion notice was delivered later than five days after February 28, 2023.  Petitioner instead asserts that a business trip and personal matters delayed Petitioner’s review of the exclusion notice until March 14, 2023.  Petitioner then waited until 59 days from March 14, 2023, to file a four-page RFH.  

I do not find the scenario presented by Petitioner as a sufficient showing that the five-day presumption of receipt has been rebutted.  As explained above, receipt is delivery to a proper address for the excluded individual, rather than the date on which Petitioner eventually reads mail that had been delivered on an earlier date.² 

I note that I am required to dismiss an untimely RFH, and I have no discretion not to do so.  I am without jurisdiction to adjudicate Petitioner’s appeal because it was untimely.  Ishtiaq A. Malik, M.D., DAB No. 2962 at 9 (2019). 

III.  Order

I dismiss Petitioner’s RFH for untimeliness. 

Endnotes

¹  Although the Social Security Administration adopted the IG’s procedural regulations almost in their entirety for its civil monetary penalty cases, its regulations differ in that they include a good cause exception to the 60-day filing deadline.  20 C.F.R. § 498.202(f)(1); 61 Fed. Reg. 65,467, 65,468 (Dec. 13, 1996).

²  Even if I were to accept the principle that being away from the delivery address changed the date of receipt, I would consider receipt to be the date that the excluded individual returned to the delivery address and not the day that the excluded individual eventually opened mail that had accumulated.  In this case, that would be March 12, 2023.  Even accepting such a date of receipt, Petitioner’s RFH is one day late.